QUESTION: If I can turn to another subject for a moment.
The Senate is going to take up the tax bill, which contains about $70
billion in the Senate version of tax increases in order to pay for,
among other things, the President's version, the President's proposal
to cut the tax on dividends. Does the administration support those tax
increases? And in particular, is it going to urge Republicans to vote
to retain the provision that would raise taxes by $35 billion on
Americans living and working abroad?

MR. FLEISCHER: Okay, I want to remind you, particularly on
the provision you just cited about Americans working abroad, that was
not in the President's budget. It was not a proposal that the President
made. And there are a variety of different ideas that are being
circulated in the House and in the Senate as they work toward the final
conference agreement on the tax bill, which is where the key decisions
are going to be made.

The President's budget contained $11 billion worth of offsets over
10 years. Most of these were loophole closures, provisions that should
not be in the tax code, they believe should be removed from the tax
code. As to the specifics of it, we'll continue to work with Congress
to see what is meritorious, what is, indeed, a loophole closure and not
a tax increase. But the provision you just cited was not part of the
President's plans.

QUESTION: Is that a signal, then, that Republicans
should, when this comes up as an amendment, vote against keeping it
in?

MR. FLEISCHER: Well, Republicans, Democrats alike will vote
their conscience on every different provision as they see fit. The
President's focus is on making progress and getting this bill into the
House-Senate conference where these important decisions will be made.

QUESTION: Related to Dick's question, the President
at most every stop has been saying that temporary tax cuts are not good
because you can't do the planning you need. Now, it sounds like the
White House seems to be lending some support to a notion of making the
dividend tax cut temporary. Is that, in fact, so, and how can you --

MR. FLEISCHER: Well there's no question the President would
prefer to have the tax provisions be permanent. But if that is not the
case, then the President wants to make progress by, for example,
accelerating the marriage penalty relief, accelerating the child
relief. And as you know from the 2001 act, there were many provisions
in there, such as the repeal of the death tax that was extended for 10
years, not in perpetuity.

So, yes, the President is continually pushing for the goal of
making these permanent. But given the constraints that we must operate
under, given the budget resolution, the President will work with what
we are working with, and make the most progress possible and keep
coming at it.

QUESTION: So temporary is better than nothing, if
that's the choice?

MR. FLEISCHER: Well, clearly, if somebody can get the child
credit accelerated to $1,000 immediately, that's preferable,
particularly given the fact that will have an economic boost in 2003,
at a time the economy needs it the most. So there is sound tax policy
to it, sound economic policy to it. It could be sounder, but it still
is sound.

QUESTION: But this is the dividend thing, in
particular, that -- a temporary is better than nothing on that?

MR. FLEISCHER: Well, on the dividend thing, the President is
going -- the dividend thing -- on the dividend exclusion, the President
is going to continue to push to get 100 percent dividend exclusion, and
we'll see what duration that may be and how that can be worked. There
are a variety of different ways on a tax bill to forge agreements.

QUESTION: Ari, how would you characterize the state
of play in the tax cuts on the Hill right now? And does the President
still expect a bill by Memorial Day?

MR. FLEISCHER: The timing does look good. Despite the Senate
Finance Committee's action to go back into committee yesterday, they
are moving forward. In fact, it's worth noting that this is an
important week in the Senate. They are making progress on two major
pieces of domestic legislation. One is a growth package, which looks
like it will be voted on before the week is through. And the second is
AIDS legislation -- to follow the House, which has already passed the
President's proposal from the State of the Union, for a $15-billion
AIDS initiative to help the people of Africa and the Caribbean. These
are two major domestic initiatives, both of which are moving forward
rather nicely this early in the year.

It's also worth noting that in Moscow today the Duma ratified the
Treaty of Moscow for the offensive reductions in nuclear weapons
between the United States and Russia.

So on the domestic front and on the foreign policy front, this can
be an important week. It has already been an important week in foreign
policy with Russia; two major bills pending in the Senate. So I think
you know I've spent a lot of time on the Hill; it's unusual to have
this much legislative action being done this early in a session. It's
unusual for the tax bill to be considered this early. Remember in 1997,
when a tax bill was agreed to, and it was signed by then President
Clinton, that wasn't agreed to until July or August of 1997. So they're
ahead of schedule, and that's good for the economy because it means you
can deliver more boost to the economy earlier, which is good for people
who are looking for work.